Initial drilling results from CleanTech Lithium‘s (AIM: CTL) Laguna Verde project in northern Chile suggest it could become a major supplier of battery grade lithium to European and U.S. markets.
The U.K.-based exploration and development company said in a news release Thursday that the results also show the economics of the project are “outstanding.”
CleanTech based its analysis on a model that calls for a mine with annual production of 20,000 tonnes of battery grade lithium carbonate and an operational life of 30 years, according to measured and indicated resources.
The study estimated accumulated net cash flows — after tax and including royalties — of US$6.3 billion ($8.5 billion) to be generated over the Laguna Verde’s operational life, with an operating cost of US$3,875 per tonne. It also estimates an after tax net present value of US$1.83 billion.
Total capital expenditure is pegged at US$383.6 million, with lithium production starting in 2026, though CleanTech’s management targets starting operations in late 2025.
The company noted a pre-feasibility study will begin immediately and it is expected to be completed in the second half of the year.
“Chilean lithium sector experts at Ad-Infinitum have already commenced work on the Francisco Basin scoping study and our board is hopeful that the economics and ESG credentials prove to be as attractive as we’ve seen for Laguna Verde,” chief executive Aldo Boitano said in the statement.
The company plans to mine the battery metal by using direct lithium extraction (DLE) technology, which draws lithium straight from the brine and doesn’t require evaporation ponds. That in turn doesn’t deplete the aquifer or harm the environment, the company says.
Laguna Verde and Francisco Basin, both located about 950 km north of Santiago are CleanTech Lithium’s flagship projects. In addition, the miner owns the Llamara greenfield project, located about 600 km to the south of the two assets.
Lithium has soared 1,200% over the past several years as supply has failed to match growing demand. That has hurt battery makers, which have been forced to raise prices.
The average price for a lithium-ion battery pack went up by 7% in 2022, according to BloombergNEF, the first increase since the group began their survey in 2010.
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